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3.
Foreword
IndIa has long played an Important role in the world’s wind energy
market. already established in the 1990s, by 2005 it had developed into the world’s
fourth largest market, and the only sizeable market in asia at that time.
In 2008, India was the country that brought online the third largest amount of wind
energy, after the uS and China, and it now ranks fifth in total installed capacity with
9,645 mW of wind power installed at the end of 2008.
a strong domestic manufacturing base has underpinned the growth of the Indian wind
energy market. the Indian wind turbine manufacturer Suzlon is now a recognised player
on the global market, and many international companies are established in India.
India has a great untapped potential for wind energy. according to official estimates, the
country’s total wind energy resource amounts to 48 gW of installed capacity, but some
experts think that this figure is on the conservative side, and that technological
improvements could significantly increase this potential.
the positive development of wind energy in India has mainly been driven by progressive
state level legislation, including policy measures such as renewable portfolio standards
and feed-in-tariffs. at the moment, there is no coherent national renewable energy
policy to drive the development of wind energy. this is urgently needed to realise the
country’s full potential and reap the benefits for both the environment and the economy.
the Indian government is currently considering the introduction of a national renewable
energy policy, so this report comes as a timely reminder of how important a role wind
energy could play in securing India’s energy security, curbing its CO2 emissions,
providing new employment and boosting economic development.
as can be seen by the Indian Wind energy Outlook, the wind industry, both domestic and
international, stands ready to do its part in achieving an energy revolution in India. With
sufficient political will and the right policy frameworks, it could do even more.
dv g I r I S te ve S aWye r
Chairman Secretary General
Indian Wind Turbine Manufacturer Association Global Wind Energy Council
3

5.
t h e S tat u S O f W I n d e n e rg y I n I n d I a
Indian power sector renewable energy in India
India’s rapidly growing economy and population leads to In the early 1980s, the Indian government established the
relentlessly increasing electricity demand. as a result, the ministry of non-Conventional energy Sources (mneS) to
country’s installed power generation capacity has increased encourage diversification of the country’s energy supply, and
from just 1.4 gW in 1947 to over 150 gW in 2009. satisfy the increasing energy demand of a rapidly growing
economy. In 2006, this ministry was renamed the ministry of
the current generation mix in India is dominated by coal new and renewable energy (mnre).
(78.5 gW), large hydropower (36.9 gW) and gas (16.4 gW).
renewable sources rank fourth with an installed capacity of renewable energy is growing rapidly in India. With an
around 13.2 gW. installed capacity of 13.2 gW, renewable energy sources
(excluding large hydro) currently account for 9% of India’s
despite the massive capacity additions, the Indian govern- overall power generation capacity. by 2012, the Indian
ment is struggling to keep up with growing demand. the Iea government is planning to add an extra 14 gW of renewable
predicts that by 2020, 327 gW of power generation capacity sources.
will be needed, which would imply an addition of 16 gW per
year. this urgent need is reflected in the target the Indian In its 10th five year plan, the Indian government had set itself
government has set in its 11th five year plan (2007-2012), a target of adding 3.5 gW of renewable energy sources to the
which envisages an addition of 78.7 gW in this period, generation mix. In reality, however, nearly double that figure
50.5 gW of which is coal . 1)
was achieved. In this period, more than 5.4 gW of wind
energy was added to the generation mix, as well as 1.3 gW
from other re sources. the target set for the period from
E L ECTR ICITY G EN ER ATION CA PACITY I N I NDI A
2008-2012 was increased to 14 gW, 10.5 gW of which to be
Renewable Energy Sources 9%
new wind generation capacity.
the Indian ministry of new and renewable energy (mnre)
estimates that there is a potential of around 90,000 mW for
power generation from different renewable energy sources in
Hydro 25% Coal 51%
the country, including 48,561 mW of wind power,
14,294 mW of small hydro power and 26,367 mW of
biomass. In addition, the potential for solar energy is
Nuclear 3%
Diesel 1%
estimated for most parts of the country at around 20 mW
Gas 11% per square kilometer of open, shadow free area covered with
Source: Ministry of Power, June 2009 solar collectors, which would add up to a minimum of
657 gW of installed capacity.
R En Ewa b l E En ERg y capaci ty addi ti o ns duRi ng 10th/11th Fi vE y EaR plan
technology target 2003 – 2007(Mw) actual 2003 – 2007(Mw) target 2008 – 2012
Windpower 2,200 5,426 10,500
Small hydro (< 25 mW) 550 537 1,400
biomass power / Cogeneration 725 759 1,700
biomass gasifier 37 26 –
Solar pv 2 1 –
Waste to energy programme 70 47 400
total 3,584 6,795 14,000
Source: MNRE
1 http://cea.nic.in/planning/Capacity%20addition%20target%20during%2011th%20plan%20set%20by%20planning%20Commission%20(revised)-summary%20region%20wise.pdf
5

7.
t h e S tat u S O f W I n d e n e rg y I n I n d I a
wind EnERgy potEntial in india accoRding to c-wEt
Wind potential
state potential (Mw)
the total potential for wind power in India was first estimat- andhra pradesh 8,968
gujarat 10,645
ed by the Centre for Wind energy technology (C-Wet) at
karnataka 11,531
around 45 gW, and was recently increased to 48.5 gW. this
kerala 1,171
figure was also adopted by the government as the official
madhya pradesh 1,019
estimate.
maharashtra 4,584
Orissa 255
the C-Wet study was based on a comprehensive wind rajasthan 4,858
mapping exercise initiated by mnre, which established a tamil nadu 5,530
country-wide network of 1050 wind monitoring and wind total 48,561
mapping stations in 25 Indian States. this effort made it
possible to assess the national wind potential and identify
suitable areas for harnessing wind power for commercial use,
and 216 suitable sites have been identified.
however, the wind measurements were carried out at lower
hub heights and did not take into account technological
innovation and improvements and repowering of old turbines
to replace them with bigger ones. at heights of 55-65 meters,
the Indian Wind turbine manufacturers association (IWtma)
estimates that the potential for wind development in India is
around 65-70 gW. the World Institute for Sustainable
energy, India (WISe) considers that with larger turbines,
greater land availability and expanded resource exploration,
the potential could be as big as 100 gW.
7

8.
t h e S tat u S O f W I n d e n e rg y I n I n d I a
steady market growth for wind this is beginning to change as other states, including
maharashtra, gujarat, rajasthan and karnataka, West bengal,
Wind energy is continuing to grow steadily in India. Wind madhya pradesh and andhra pradesh start to catch up, partly
power capacity of 4,889 mW was added in the last three driven by new policy measures. as a result, wind farms can be
years, taking the total installed capacity to 10.2 mW on seen under construction all across the country, from the
31 march 2009, up from 7.8 gW at the end of 2007. coastal plains to the hilly hinterland and sandy deserts. the
Indian government envisages the addition of 2 gW/annum in
Wind power in India has been concentrated in a few regions, the next five years.
especially the southern state of tamil nadu, which maintains
its position as the state with the most wind power, with
4.1 gW installed at the end of 2008, representing 44% of
India’s total wind capacity.
T E N Y EA R GROW TH OF IN D IA N W IN D M A R K E T CU M U L AT I V E CA PACI T Y I N M W 1999 2008
12,000 � MW �
10,000
8,000
6,000
4,000
2,000
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
1,077 1,167 1,407 1,702 2,125 3,000 4,430 6,270 7,845 9,645
Source: IWTMA
in s ta l l Ed capaci ty by REgi o n
total capacity Market share capacity Market share
state as on 31st March 2009 as on 31st March 2009 as on 31st March 2008 as on 31st March 2008
rajasthan 738,5 7,22% 538,9 6,16%
gujarat 1565,61 15,31% 1253 14,33%
madhya pradeh 212,8 2,08% 187,7 2,15%
maharashtra 1942,25 19,00% 1755,9 20,08%
andhra pradesh 122,5 1,20% 122,5 1,40%
karnataka 1340,23 13,11% 1011,4 11,57%
tamil nadu 4301,63 42,08% 3873,5 44,30%
total 10223,52 100,00% 8742,9 100,00%
Note: The Indian financial year runs from 1 April – 31 March
8

9.
t h e S tat u S O f W I n d e n e rg y I n I n d I a
Cdm projects the development of a domestic
industry and foreign investment
India signed and ratified the kyoto protocol in august 2002,
and the possibility to register projects under the kyoto India has a solid domestic manufacturing base, including
protocol’s Clean development mechanism (Cdm) has global leader Suzlon, vestas Wind tech and rrb. In addition,
provided a further incentive to wind energy development in international companies have set up production facilities in
India. the final approving authority for Cdm projects is the India, including enercon, vestas and ge and the new entrants
ministry of environment and forests, following a four stage like gamesa, Siemens, regen power tech, lm glasfiber,
process at national level. WinWind, kenersys and global Wind power. Overall, a dozen
international companies now manufacture wind turbines in
as of 1 august 2009, 301 Indian wind projects were registered India, through either joint ventures under licensed produc-
with the Cdm executive board, accounting for 5,659 mW, tion, as subsidiaries of foreign companies or as Indian
second only to China. companies with their own technology.
Over the past few years, both the government and the wind
tablE 2: wind cdM pRojEcts (as oF 1 august 2009)
power industry have succeeded in injecting greater stability
country projects Mw
into the Indian market. this has encouraged larger private
India 301 5,659
and public sector enterprises to invest in wind. It has also
China 371 20,695
mexico 12 1,272
stimulated a stronger domestic manufacturing sector; some
brazil 10 674 foreign companies now source more than 80% of the
South korea 12 339 components for their turbines in India. the current annual
Cyprus 4 207 production capacity of wind turbines manufactured in India is
egypt 4 406 about 3,000-3,500 mW, including turbines for the domestic
Chile 4 111 as well as for the export markets. however, the actual
morocco 3 92
number of turbines produced is driven by market forces, and
dominican republic 2 165
high interest rates often do not allow for the accumulation of
Costa rica 2 69
inventory. thanks to new market entrants, it is expected that
nicaragua 2 60
phillipines 1 33
the annual production capacity will rise to 5,000 mW per
panama 1 81 year by 2015.
mongolia 1 50
Jamaica 1 21 Indigenously produced wind turbines and turbine blades have
Colombia 1 20 been exported to the uSa, europe, australia, China and brazil.
Israel 1 12
argentina 1 11
Indian company Suzlon, the world’s fifth largest turbine
vietnam 1 30
manufacturer, provides over 50% of all turbines used in the
uruguay 1 50
domestic market. In addition, the company is now well estab-
Sri lanka 1 10
Cape verde 1 28
lished in the international wind market beyond India,
ecuador 1 2 operating in 20 countries around the world and supplying
total 739 30,095 turbines to projects in asia, north and South america and
Source: http://www.cdmpipeline.org/cdm-projects-type.htm europe. Components and turbines have also been exported
by vestas Wind technologies, enercon, rrb energy, Southern
Wind farms and Shriram epC. almost all Indian manufactur-
ers are now looking at the export market, where better prices
can be achieved than in the domestic market.
9

11.
the pOlICy envIrOnment fOr WInd energy In IndIa
national policy measures for • 0% accelerated depreciation over one or two years
8
wind energy • 0 year income tax holiday for wind power generation
1
projects
India is heavily dependent on fossil fuels for its energy needs, • xcise duty relief on certain components
E
mainly coal, of which it has significant reserves. however, to fuel • ome states have also announced special tariffs, ranging
S
a thriving economy and a targeted gdp growth rate of 7-8% per from rs 3-4 per kWh, with a national average of around
year, the country’s electricity demand is projected to more than rs 3.50 per kWh
triple between 2005 and 2030. already today, electricity • heeling, banking and third party sales, buy-back facility
W
shortages are common, and a significant part of the population by states
has no access to electricity at all. to address this problem, the • uarantee market through a specified renewable portfolio
G
Indian government has envisaged a capacity addition of more standard in some states, as decided by the state electricity
than 70,000 mW by 2012. In addition, grid infrastructure regulator by way of power purchase agreements
problems are getting more pressing as installed capacity grows. • educed wheeling charges as compared to conventional
R
energy
the Indian government’s stated target is for renewable
energy to contribute 10% of total power generation capacity land policies:
and have a 4-5% renewables share in the electricity mix by • he Ministry of Environment and Forests has issued
T
2012. this means that renewable energy would grow at a guidelines for diversion of forest lands for non-forest
faster rate than traditional power generation, accounting for purposes, particularly to enable wind generation
around 20% of the total added capacity planned in the 2008- • learance of leasing and forest land for up to a period of
C
2012 timeframe. 30 years for wind developers
thE 20 0 3 E lE c tR ic ity ac t Financial assistance:
• etting up of the Indian Renewable Energy Development
S
In spite of its stated target for renewable energy to contrib- agency (Ireda), the premier finance agency of the
ute 4-5% of India’s electricity mix by 2012, the country does government of India to provide soft loans for renewable
not have a national renewable energy policy. Currently, the energy projects, particularly for demonstration and private
promotion of renewables only figures in one section of the sector projects
2003 electricity act (86(1)e). this act restructured the Indian
electricity industry by unbundling the vertically integrated Wind resource assessment:
electricity supply utilities in the Indian states and establishing • he government set up the Centre for Wind Energy
T
State regulatory Commissions (SerCs) in charge of setting technology (C-Wet) to map wind energy potentials
electricity tariffs. the act also opened access to the Indian • he C-WET has set up more than 1,000 wind monitoring
T
transmission system, allowing consumers to purchase their and wind mapping centers across 25 states
electricity from any producer. • ind mapping at 50 meters (C-WET) and 60-80 meters
W
height (private companies)
the electricity act also required the SerCs to set renewable
portfolio Standards for electricity production in their state. n at i o n a l F EEd - i n -ta R i F F
following this, the ministry for new and renewable energy
(mnre) issued guidelines to all state governments to create In June 2008, the mnre announced a national generation-
an attractive environment for the export, purchase, wheeling based incentive scheme for grid connected wind power
and banking of electricity generated by wind power projects. projects under 49 mW, providing an incentive of 0.5 rupees
per kWh (0.7 euro cents) in addition to the existing state
the support for wind power in India includes the following incentives. Investors which, because of their small size or lack
measures: of tax liability cannot draw any benefit from accelerated
depreciation under the Income tax act can opt for this
Fiscal and financial incentives: alternative incentive instead. however, this tariff is too low to
• oncession on import duty on specified wind turbine parts
C have a significant impact on a project’s viability.
11

12.
the pOlICy envIrOnment fOr WInd energy In IndIa
a b R iEF coMpa R is on oF wi nd EnERgy po li ci Es i n kEy statEs
wheeling or specified Renewable
tariff rates transmission portfolio standards
states per kwh annual tariff escalation charges capital incentives for wind
tamil nadu rs. 3.39 nil (fixed for 5 years) 5% of tariff paid national policies 10% (2008-2009)
13% (2009-2010)
14% (2010-2011)
gujarat rs. 3.37 nil 4% of tariff paid has an exclusive policy in 2% (2008-09)
addition to the national policies
rajasthan rs. 4.28-4.50 rs. 0.02 every year for 10 years 10% of tariff paid national policies 5% (2008-09)
karnataka rs.3.40 nil 2% of tariff paid national policies 2% (2008-09)
madhya rs. 4.03 variable increase up to 20 years 2% of tariff paid national policies 5% (2008-09)
pradesh and then reduces and 6% from 2009-2011
West bengal rs.4.00 nil rs. 0.30 per kWh national policies 8% (2008-09)
kerala rs. 3.14 fixed for 20 years nil national policies 5% (2008-09)
maharashtra rs. 3.50 rs. 0.15 per annum for 15 years 7% of tariff paid national policies 6% for all reS (2008-09)
andhra rs. 3.50 nil 5% of tariff paid national policies 5% (2008-09)
pradesh
harayana nil n/a nil national policies 3% (2008-2009)
state policies the need for an improved
RE nEwablE poRtF olio sta nda R ds a nd
national policy framework
Financi al i ncEntivE s
India’s tremendous wind energy resource has only been
In the absence of a national renewable energy policy, ten out partially realised due to the lack of a coherent national
of the 29 Indian States have now implemented quotas for a renewable energy policy. Currently, the promotion of
renewable energy share of up to 10% and have introduced renewable energy in India is mainly driven by state govern-
preferential tariffs for electricity produced from renewable ments, but inconsistent implementation and the lack of a
sources. In addition, several states have implemented fiscal national policy is hampering genuine progress. While some
and financial incentives for renewable energy generation, states have set high renewable portfolio standards, other
including; energy buy back (i.e. a guarantee from an electric- states only have low or no targets, and enforcement is
ity company that they will buy the renewable power insufficient. furthermore, while in theory, rpS and feed-in-
produced); preferential grid connection and transportation tariffs can coexist, this needs to be well managed to avoid
charges and electricity tax exemptions. inefficiencies.
FEE d-in-ta RiFFs to boost investment in renewable energy, it is essential to
introduce clear, stable and long-term support policies. a
Some states with renewable portfolio Standards (rpS) or number of policy measures at national level, which could be
other policies to promote wind generation, have introduced applied concurrently, would significantly improve the
feed-in-tariffs for wind generation which are higher than that framework for renewable energy in India. however, they
for conventional electricity. must be carefully designed to ensure that they operate in
harmony with existing state level mechanisms and do not
lessen their effectiveness.
12

13.
the pOlICy envIrOnment fOr WInd energy In IndIa
a number of policy measures outlined below are already in
various stages of being drafted at national level, and some
have been initiated by a number of states. It is recommended
that these are treated with urgency and implemented at the
national level wherever possible.
a n atIon al r e ne Wabl e p ort Fol I o s ta n da r d
the national action plan on Climate Change released in
2008 included a proposal for a national renewable energy
trading scheme, which would be based on a national
renewable portfolio Standard. this proposal is currently
undergoing approval and it is expected that a notification by
the Central electricity regulatory authority, which would be
mandatory for all states, may be issued before the end of
2009.
a n at I o n a l F e e d -I n -ta r I F F
this national rpS, which would be set by the Central
electricity regulatory authority, would complement or the introduction of a national feed in tariff would help to
supplement existing portfolio standards at state level. Such a ensure uniform tariff incentives and provide strong investor
dynamic national standard will have a minimum stipulated confidence.
purchase obligation of renewable energy from 2009-2010
and a 1% or 2% increase in the amount every year for the a feed-in-tariff would introduce a generation based
next 10-20 years. this can co-exist with already existing state Incentives (gbI) scheme for electricity from renewable
renewable energy portfolio standards which can be over and energy. In the short run (up to a maximum period of 5 years),
above the minimum stipulated in the national standards and the investor would have an option to either choose the gbI or
so similarly, the annual increment could also increase as per the existing accelerated depreciation benefits, which are
the state norms. currently in place for the wind sector. however, over a period
of time, the accelerated benefits will give way for a progres-
Ideally, a national rpS would be linked to a market based sive performance based generation incentives.
scheme for tradeable renewable energy certificates. In this
scheme, states would be encouraged to promote the a d d I tI o n a l m e a s u r e s
production of renewable power to exceed the national
standard. they would then receive certificates for this surplus an updated wind resource map of India is urgently needed to
power, which would be tradable with other states which fail assess the country’s wind energy potential. this should be
to meet their renewable standard obligations. Since only grid- done on the basis of up to date information on land
connected electricity would be eligible for this scheme, this availability, mast height of modern turbines, technological
would particularly benefit the wind industry. innovations etc.
Such a renewable certificate scheme needs to be carefully administrative procedures for approving renewable energy
designed. the targets should be set after considering existing projects need to be accelerated to avoid the waste of both
plans for new electricity generation, and in harmony with time and money spent on getting clearances from a wide
existing targets at state level. In addition, the scheme must range of authorities.
be enforceable through the introduction of a national
verification mechanism to ensure that all states comply with lastly, the accessibility of financing for renewable energy
the national portfolio standards and face penalties if they do projects must be improved to ensure fair treatment in terms
not. of interest rates and loan disbursements.
13

15.
the WInd energy OutlOOk SCenarIOS
thIs Chap t e r out l I ne s t h re e different scenarios for on orders for wind turbines already committed. after 2012
the development of wind energy, both globally, and for the pattern of development is more difficult to anticipate.
India. the scenarios examine the future potential of wind
power up to the year 2030, starting from a range of a dva n cEd s cEn a R i o
assumptions which will influence the wind energy industry’s
expected development. the most ambitious scenario, the “advanced” version
examines the extent to which this industry could grow in a
these scenarios are based on a report entitled ‘global Wind best case ‘wind energy vision’. the assumption here is that all
energy Outlook 2008’, which was published as a collabora- policy options in favour of renewable energy, along the lines
tion between the global Wind energy Council (gWeC), of the industry’s recommendations, have been selected, and
greenpeace International and the german aerospace Centre the political will is there to carry them out.
(dlr). projections on the future of wind energy development
have contributed to a larger study of global sustainable While again, the development after 2012 is more difficult to
energy pathways up to 2050 conducted by dlr for green- predict, this scenario is designed to show what the wind
peace and the european renewable energy Council (ereC). energy sector could achieve if it were given the political
commitment and encouragement it deserves in light of the
twin crises of energy security and global climate change. the
scenarios rapid growth in the sector over the past decade most closely
resembles this scenario.
REFEREncE sc E na R io
three different scenarios are outlined for the future growth of energy demand projections
wind energy around the world. the most conservative
“reference” scenario is based on the projections in the 2007 these three scenarios for the global wind energy market are
World energy Outlook from the International energy agency then set against two projections for the future growth of
(Iea). this takes into account only existing policies and electricity demand, one “reference demand projection” and
measures, but includes assumptions such as continuing one “energy efficiency demand projection”.
electricity and gas market reform, the liberalisation of
cross-border energy trade and recent policies aimed at R EF ER En cE d EM a n d p Ro j Ect i o n
combating pollution.
the more conservative of the two global electricity demand
ModERatE sc E na R io projections is again based on data from the Iea’s 2007 World
energy Outlook, including its assumptions on population and
the “moderate” scenario takes into account all policy gdp growth. It takes account of policies and measures that
measures to support renewable energy either already enacted were enacted or adopted by mid-2007, but does not include
or in the planning stages around the world. It also assumes possible or likely future policy initiatives. It is assumed that
that the targets set by many countries for either renewables there will be no changes in national policies on nuclear
or wind energy are successfully implemented. moreover, it power.
assumes increased investor confidence in the sector as a
result of a successful outcome of the current round of climate the Iea’s estimation is that in the absence of new govern-
change negotiations, which are set to culminate at unfCCC ment policies, the India’s energy demand will rise from
COp-15 in Copenhagen, denmark, in december 2009. 537 mtoe in 2005 to 1,299 mtoe in 2030. electricity demand
rises from 478 tWh in 2005 to 2,700 tWh in 2030.
up to 2012 the figures for installed capacity are closer to
being forecasts than scenarios. this is because the data
available from the wind energy industry shows the expected
growth of worldwide markets over the next five years based
15

16.
the WInd energy OutlOOk SCenarIOS
REgi o REFERENCE down: REFEREncE scEnaRi o [gw]
nal bREak SCENARI O ( GW) 2020 / 2030
E n ERgy EFFi ci Ency dE Ma nd pRojE c tion
Africa OECD Paciﬁc (incl. South Korea)
Middle East 1% 1% 3%
China 8% 20
the Iea’s expectations on rising energy demand are then set 20
against the outcome of a study on the potential effect of India 6% 1% 1% 3%
10% 20
3
energy efficiency savings developed by dlr and the ecofys Dev. Asia 2%
5%
0
(excl. S. Korea)
1%
consultancy. this study describes an ambitious development 3%
Latin
America 2% 46%
path for the exploitation of energy efficiency measures, based
on current best practice technologies, emerging technologies North
America 26% 27%
that are currently under development and continuous
2%
innovation in the field of energy efficiency. 50%
2%
In reality, of course, constraints in terms of costs and other Transition
Economies Europe
2020
barriers, such as resistance to replacing existing equipment
europe 176 gW
and capital stock before the end of its useful life, will prevent
transition economies 7 gW
this ‘technical’ energy efficiency potential to be fully realised.
north america 92 gW
In order to reflect these limitations, we have used the more latin america 5 gW
moderate energy efficiency scenario from the study, which dev. asia (excl. S. korea) 7 gW
is based on implementing 80% of the technical potential. India 20 gW
China 27 gW
this scenario results in energy demand increasing by much middle east 2 gW
less than under the reference projection. under the energy africa 4 gW
OeCd pacific (incl. South korea) 12 gW
efficiency demand projection, energy demand would reach
2,395 tWh in 2030, which is 11% lower than under the 2030
eurOpe 227 gW
reference Scenario.
transition economies 11 gW
north america 132 gW
regional breakdown latin america 8 gW
dev. asia (excl. S. korea) 16 gW
India 27 gW
all three global scenarios for wind power are broken down by China 49 gW
region of the world based on the regions used by the Iea, middle east 4 gW
with a further differentiation in europe. for the purposes of africa 7 gW
this analysis, the regions are defined as europe (eu-27 and OeCd pacific (incl. South korea) 16 gW
the rest of europe), the transition economies (former Soviet
union states, apart from those now part of the eu), north
america, latin america, China, India, the pacific (including figures above. this shows that in the reference scenario,
australia, South korea and Japan), developing asia (the rest europe would continue to dominate the world market.
of asia), the middle east and africa. by 2030 europe would still host 46% of global wind power
capacity, followed by north america with 27%. the next
this breakdown of world regions has been used by the Iea in largest region would be China with 10%.
the ongoing series of World energy Outlook publications. It
was chosen here to facilitate a comparison with those the two more ambitious scenarios envisage much stronger
projections and because the Iea provides the most compre- growth in regions outside europe. under the moderate
hensive global energy statistics. a list of countries covered by scenario, europe’s share will have fallen to 23% by 2030, with
each of the regions is shown on p. 26/27. north america contributing a dominant 27 % and major
installations in China (14%), India (10%) and developing asia
the level of wind power capacity expected to be installed in (10%). latin america (7%) and the pacific region (5%) will
each region of the world by 2020 and 2030 is shown in the
16

18.
the WInd energy OutlOOk SCenarIOS
main assumptions and It is also assumed that each turbine will have an operational
parameters for India lifetime of 20 years, after which it will need to be replaced.
this “repowering” or replacement of older turbines has been
gRowth RatEs taken into account in the scenarios.
market growth rates in these scenarios are based on a ca paci t y Facto R
mixture of historical figures and information obtained from
analyses of the wind turbine market. annual growth rates of ‘Capacity factor’ refers to the percentage of its nameplate
25% per annum, as envisaged in the advanced version of the capacity that a turbine installed in a particular location will
scenario, are high for an industry which manufactures heavy deliver over the course of a year. this is primarily an assess-
equipment. the wind industry has experienced much higher ment of the wind resource at a given site, but capacity factors
growth rates in recent years, however. In the last five years, are also affected by the efficiency of the turbine and its
the average annual increase in cumulative installed wind suitability for the particular location. for example, a 1 mW
power capacity in India was more than 35%; for the nine year turbine operating at a 25% capacity factor will deliver
period from 2000-2008, it was over 28%. 2,190 mWh of electricity in one year.
It should also be borne in mind that while growth rates from an estimated average capacity factor in India today of
eventually decline to single figures across the range of 20.5%, the scenario assumes that improvements in both
scenarios, the level of wind power capacity envisaged in 20 wind turbine technology and the siting of wind farms will
years’ time means that even small percentage growth rates result in a steady increase.
will by then translate into large figures in terms of annually
installed megawatts. the scenario projects that the average capacity factor in India
will increase to 23% by 2011, 25% by 2021 and then 27.5%
these scenarios assume that significant repowering from 2026.
(replacing of smaller old turbines by modern and more
powerful machines) will take place in the period up to 2030. ca p i ta l co s t s
In addition, with a coastline of 7,000 km, it is expected that
offshore installations will play an important role in that the capital cost of producing wind turbines has fallen steadily
timeframe, thereby substantially increasing the overall wind over the past 20 years as turbine design has been largely
energy potential. concentrated on the three-bladed upwind model with
variable speed and pitch blade regulation, manufacturing
t u Rbi nE capaci ty techniques have been optimised, and mass production and
automation have resulted in economies of scale.
Individual wind turbines have been steadily growing in terms of
their nameplate capacity – the maximum electricity output While the years 2006 to 2008 have seen a marked increase in
they achieve when operating at full power. the average the price of new wind turbines globally, caused by rising raw
capacity of wind turbines installed in India in 2008 was 1mW, material prices and shortages in the supply chain for turbine
up from just 400 kW in 2000. globally, the largest turbines components, the ramifications of the financial crisis has
now available for commercial use are up to 6 mW in capacity. reversed this upwards trend. as financing for new projects
became harder to come by, previous supply chain difficulties
We make the conservative assumption that in India, the were overcome. In addition, decreasing raw material prices
average size will gradually increase from today’s figure to also helped bring prices down. as a result, since late 2008,
1.5 mW in 2013, increasing to 2 mW by 2030. It is possible global turbine prices have dropped by 18% for turbines to be
that this figure will turn out to be greater in practice, delivered in the first half of 20101).
requiring fewer turbines to achieve the same installed
capacity.
1 New Energy Finance, Press release: Newly launched Wind Turbine Price Index shows an 18%
decrease in contract prices for delivery in H1 2010 (29 July 2009)
18

20.
the WInd energy OutlOOk SCenarIOS
CUMUL ATIVE CA PACITY MW A N D ELECTRI CI TY GENERATI O N GWH I NDI A
250,000 [ MW ] Reference [MW] Reference [GWh] [ GWh ] 600,000
Moderate [MW] Moderate [GWh]
500,000
200,000 Advanced [MW] Advanced [GWh]
400,000
150,000
300,000
100,000
200,000
50,000
100,000
0 0
2010 2015 2020 2025 2030
cu M u l ativE ca pacity [ M w] a nd ElEctRi ci ty gEnERati o n [gwh] i ndi a
year 2010 2015 2020 2025 2030
Reference [mW] 12,495 17,119 20,332 23,571 27,325
[gWh] 22,491 34,238 40,665 51,856 65,580
Moderate [mW] 13,741 31,436 63,230 111,432 142,219
[gWh] 24,734 62,873 126,459 245,151 341,325
advanced [mW] 15,070 45,991 134,828 189,104 241,349
[gWh] 27,127 91,982 269,656 416,028 579,238
capacity increase of around 800 mW. depending on the a dva n cEd s cEn a R i o
demand side developments, the penetration of wind energy
in India would, in this scenario, decrease from 3.3% in 2010 under the advanced wind energy scenario, an even more rapid
to 2.4-2.7% in 2030. expansion of the global wind power market is envisaged. the
assumed growth rate starts at 25% in 2009, falls to 25% by
M odERatE s cEnaRio 2010, then to 24% by 2016, going down to 5% by 2026. the
result is that by the end of this decade, Indian capacity would
under the moderate wind energy scenario growth rates are have reached 15.1 gW, with annual additions of around
expected to be substantially higher than under the reference 3.8 gW. by 2020, capacity stand at 134.8 gW, and by 2030,
version. the assumed cumulative annual growth rate starts at total wind generation capacity would reach 241.3 gW. the
20.7% for 2009, decreases to 18% by 2010, continues to fall annual market would by then stabilise at around 10 gW.
gradually to 12% by 2020 until it reaches 5% in 2025.
In terms of generated electricity, this would translate into
the result is that by the end of this decade, Indian wind 270 tWh produced by wind energy in 2020 and 579 tWh in
power capacity is expected to have reached 13.7 gW, with 2030. this would meet between 17.3% and 18.6% of India’s
annual additions of around 2 gW. by 2020, the annual electricity demand in 2020 and 21.4-24.2% in 2030.
market would have grown to 8 gW, and the cumulative wind
power capacity in India would have reached 63 gW. by 2030 shaRE oF ElEctRicity dEMand – india
a total of over 142 gW would be installed, with annual year 2010 2020 2030
additions in the region of 6.8 gW. referenCe
ref. demand % 3.3% 2.6% 2.4%
In terms of generated electricity, this would translate into energy efficiency % 3.3% 2.8% 2.7%
126.5 tWh produced by wind energy in 2020 and 341.3 tWh mOderate
in 2030. for the share of wind power in the overall electricity ref. demand % 3.6% 8.1% 12.6%
mix, this would translate into 3.6% in 2010, 8.1-8.7% in 2020 energy efficiency % 3.6% 8.7% 14.2%
and increase to 12.6-14.2% by 2030. advanCed
ref. demand % 3.9% 17.3% 21.4%
energy efficiency % 3.9% 18.6% 24.2%
20

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the WInd energy OutlOOk SCenarIOS
Costs and benefits the investment value of the generation equipment in the
future wind energy market envisaged in this scenario has
generating increased volumes of wind powered electricity been assessed on an annual basis. this is based on the
will require a considerable level of investment over the next assumption of a gradually decreasing capital cost per kilowatt
20 years. at the same time raising the contribution from the of installed capacity, as explained above.
wind will have substantial benefits for the global climate,
reduction of air pollution, economic development and In the reference scenario the annual value of investment in
increased job creation in India, and thus provide a significant wind power equipment in India falls from 96.3bn rs in 2008
boost to the Indian economy. to just 43 bn rs in 2010 and to 30.5bn rs bn by 2020, where
it will level off [all figures at €2008 values]. In the moderate
i nv EstME nt scenario the annual value of investment in the Indian wind
power sector reaches 111 bn rs in 2010 and around 412 bn rs
the relative attraction to investors of the wind energy market by 2020. In the advanced scenario the annual value of
is dependent on a number of factors. these include the investment reaches 199 bn rs in 2010 and reaches around
capital cost of installation, the availability of finance, the 472 bn rs by 2020. all these figures take into account the
pricing regime for the power output generated and the value of repowering older turbines.
expected rate of return.
INVESTMENT AND EMPLOYMENT � INDIA
700,000,0 mil Rs/year Reference Reference Jobs 250,000
Moderate Moderate
600,000,0
Advanced Advanced 200,000
500,000,0
150,000
400,000,0
300,000,0 100,000
200,000,0
50,000
100,000,0
0 0
2010 2015 2020 2025
in vEstMEnt and EMploy MEnt – i ndi a
2010 2015 2020 2025 2030
referenCe
annual installation [mW] 812 599 610 707 820
Cost mil rs/mW 53.5 50.4 50.0 50.0 50.0
Investment mil rs/year 43,017 30,180 30,498 35,356 40,987
employment 15,535 14,095 15,317 17,049 19,765
mOderate
annual installation [mW] 2,096 4,795 8,247 10,660 6,772
Cost mil rs/mW 53.5 50.4 50.0 50.0 50.0
Investment mil rs/year 111,020 241,539 412,367 532,999 338,616
employment 33,926 77,614 136,539 182,404 142,219
advanCed
annual installation [mW] 3,768 7,359 9,438 12,371 9,500
Cost mil rs/mW 53.5 50.4 50.0 50.0 50.0
Investment mil rs/year 199,550 467,985 471,899 618,563 475,000
employment 57,770 141,039 177,074 232,108 213,450
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the WInd energy OutlOOk SCenarIOS
although these figures may appear large, they should be seen ca R b o n d i oxi d E s av i n g s
in the context of the total level of investment in the global
wind power industry, which has seen an investment of more a reduction in the levels of carbon dioxide being emitted into
than €35.6 bn in 2008 alone. this is projected to reach the global atmosphere is the most important environmental
€150 bn annually by 2020 in the global advanced scenario. benefit from wind power generation. Carbon dioxide is the
gas largely responsible for the human-induced greenhouse
E M ployMEnt effect, leading to the disastrous consequences of global
climate change.
the employment effect of this scenario is a crucial factor to
weigh alongside its other costs and benefits. high unemploy- at the same time, modern wind technology has an extremely
ment rates create social problems and continue to be a drain good energy balance. the CO2 emissions related to the
on the economies of many countries in the world. any manufacture, installation and servicing over the average
technology which demands a substantial level of both skilled 20 year lifecycle of a wind turbine are “paid back” after the
and unskilled labour is therefore of considerable economic first three to six months of operation.
importance, and likely to feature strongly in any political
decision-making over different energy options. the benefit to be obtained from carbon dioxide reductions is
dependent on which other fuel, or combination of fuels, any
a number of assessments of the employment effects of wind increased generation from wind power will displace.
power have been carried out in germany, denmark and the Calculations by the World energy Council show a range of
netherlands. the assumption made in this scenario is that for carbon dioxide emission levels for different fossil fuels. given
every megawatt of new capacity, the annual market for wind the dominance of coal in India’s current electricity mix, it has
energy will create employment at the rate of 15 jobs through a relatively high carbon intensity.
manufacture, component supply, wind farm development,
installation and indirect employment. as production for the purpose of this report, we assume 1,076 gCO2/kWh as
processes are optimised, this level will decrease, falling to 11 an average value for the carbon dioxide reduction to be
jobs by 2030. In addition, employment in regular operations obtained from wind generation. Over time, as more renew-
and maintenance work at wind farms will contribute a further able energy is introduced into the Indian power system and
0.33 jobs for every megawatt of cumulative capacity. old coal fired power stations are replaced with much cleaner
gas plants, this figure is assumed to decrease to 946 gCO2/
under these assumptions, more than 400,000 workers are kWh by 20202).
employed in the global wind energy sector in 2008, with
28,400 in India alone. taking account of these assumptions, the expected annual
saving in CO2 by wind energy in India under the reference
under the reference scenario based on the Iea’s predictions, scenario would be 24.2 million tons annually in 2010, rising
this figure would decrease to just 15,500 jobs in India by the to 40 million tones by 2020 and 62 million tons in 2030. the
end of this decade and remain stable through 2020. In the cumulative CO2 savings since 1999 would amount to
moderate scenario, close to 34,000 people would be 469 million tonnes of CO2 by 2020 and 992 million tonnes
employed by the Indian wind power sector by 2010, and by 2030.
more than 136,500 by 2020 and 142,000 by 2030. the
advanced scenario would see the employment level rise to the overall CO2 savings from wind energy would be negligible
57,700 by 2010, about 177,000 by 2020 and 213,500 by in this scenario, compared with the 1,729 million tons of CO2
2030. that the Iea expects the Indian power sector will emit every
year by 2030.
2 Government of India, Planning Commission: Integrated Energy Policy, August 2006;
Greenpeace International: Energy [R]evolution – India, 2009
22

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the WInd energy OutlOOk SCenarIOS
A N N UA L A N D C UMULATI VE CO � EMI SSI O NS REDUCTI O NS I NDI A
Annual emissions reductions [ k tCO�/year ] Cumulative emissions reductions [ k tCO�/year ]
600,000 Reference Reference 600,000
Moderate Moderate
Advanced Advanced
500,000 500,000
400,000 400,000
300,000 300,000
200,000 200,000
100,000 100,000
0 0
2010 2015 2020 2025 2030
a n n u a l a n d c uMulati vE co2 EMi ssi o ns REducti o ns i ndi a
year 2010 2015 2020 2025 2030
Reference annual CO2 emissions reductions [k tCO2] 24,200 36,841 40,025 49,064 62,050
Cumulative CO2 emissions reductions [k tCO2] 118,498 281,547 468,587 700,028 992,723
Moderate annual CO2 emissions reductions [k tCO2] 26,614 67,651 124,470 231,956 322,953
Cumulative CO2 emissions reductions [k tCO2] 121,880 371,516 851,346 1,787,831 3,255,961
advanced annual CO2 emissions reductions [k tCO2] 29,188 98,973 265,415 393,635 548,061
Cumulative CO2 emissions reductions [k tCO2] 125,251 457,957 1,361,502 3,088,461 5,579,917
under the moderate scenario, Indian wind energy would g En ER at i o n co s t s
save 26.6 million tons of CO2 annually in 2010, 124.5 million
tonnes of CO2 in 2020, rising to 323 million tonnes various parameters need to be taken into account when
per year in 2030. the cumulative savings by 2020 would be calculating the generation costs of wind power. the most
851.3 million tonnes of CO2, and over the whole scenario important of these are the capital cost of wind turbines
period up to 2030, this would come to 3,256 million tonnes, (see above), the cost of capital (interest rates), the wind
more than three times the amount saved under the reference conditions at the site, and the price received for the
scenario. electricity generated. Other important factors include
operation and maintenance (O&m) costs, the lifetime of the
under the advanced scenario, the annual CO2 savings from turbine and the discount rates which are applied.
wind power would increase to close to 29.2 million tonnes by
2010, 265.4 million tonnes by 2020, and 548 million tonnes the total cost per generated kWh of electricity is traditionally
by 2030. between 1999 and 2020, over 1,361.5 million tones calculated by discounting and levelising investment and
of CO2 would be saved by wind energy alone. this would O&m costs over the lifetime of a wind turbine, then dividing
increase to 5,580 million tones over the whole scenario this by the annual electricity production. the unit cost of
period up to 2030. generation is thus calculated as an average cost over the
23